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US Fed delivers first rate hike after more than three years, raises interest rate by 0.25%

The central bank's policymakers expect inflation to remain elevated and to end 2022 at 4.3%, according to updated quarterly projections they released on March 16.

March 17, 2022 / 12:04 AM IST

In a move aimed at combating the worst inflation since the 1970s, the US Federal Reserve on March 16 announced a 0.25 percent hike in its bench-mark short-term interest rate.

The decision, taken at the Federal Open Market Committee (FOMC) meeting, marks the first time in more than three years when the key interest rate has been raised. The last hike was approved by the committee back in December 2018.

The 25 basis point-hike will bring the interest rate now into a range of 0.25-0.5 percent.

The Fed's move was widely anticipated as the central bank had indicated that it would begun unrolling some of the measures that were extended in view of the COVID-19 pandemic.